CHICAGO – The Chicago office of leading financial services provider Merchants Capital recently secured more than $110 million in total financing for Parkside 8 and Parkside 10, two mixed-use, workforce housing developments located in Ward 7 in Washington, D.C. Upon completion, Parkside 8 and 10 will feature 230 total residential units and approximately 14,000 square feet of commercial retail space. The projects are being co-developed by City Interests Development Partners and Ravinia Capital Group and they closed on the joint venture (JV) equity with the Opportunity Zone strategy managed by Bridge Investment Group. The projects will address the need for workforce housing in an expensive market, offering rental housing for low- and moderate-income households.
Parkside 8 and 10 are part of a larger, 3.1-million-square-foot and master-planned development known as Parkside. The aggregate Parkside mixed-use development will include between 1,500 and 2,000 residential units, up to 50,000 square feet of retail space, 860,000 square feet of office space, a one-acre park and a new pedestrian bridge that crosses over Kenilworth Avenue and I-295 linking the Eastland Gardens, Kenilworth and Parkside neighborhoods with the Minnesota Avenue Metrorail Station.
Additionally, Parkside offers four neighborhood educational institutions and a primary care clinic that serves both the developments’ residents and adjacent neighborhoods.
“Workforce housing is such an important component of a city’s housing plan as it supports employment populations that are critical in making the city operate. We need teachers, fire fighters, members of the police force and government employees living and working in our communities,” said Peter J. Farrell, Managing Partner at City Interests Development Partners, LLC. “Adding Parkside 8 and 10 to our mixed income housing footprint is another step in the evolution of Parkside as a live, work, play mixed-use development. Thank you to the Merchant Capital team for a job well done.”
“We are delighted with our ongoing partnership with City Interests in providing workforce housing at Parkside,” said Jim Solomon, Managing Principal of Ravinia Capital Group. “Parkside 8 and 10 is part of Ravinia’s ongoing commitment to the Parkside community as well as the city of Washington, DC. We feel that it is critically important to provide housing that’s so much in demand. Thank you, Merchants Capital, for being part of our team.”
“Housing affordability remains a challenge, and the Parkside developments will benefit community members of Ward 7 who would not otherwise be able to afford the high cost of living in Washington D.C. Our partnership with Freddie Mac allowed us to structure a complete financing solution using their non-LIHTC program for permanent debt. With construction financing provided from Merchants Bank, the entire process was seamless for the developers.”
Parkside 8 and 10 will create workforce housing without the need for federal tax credit subsidies typically required for affordable developments. Within the new properties, select units will be reserved for residents earning between 80% and 120% of area median income (AMI).
The new developments are located within the Mayfair/Parkside Opportunity Zone which has seen significant investment through the opportunity zone structure.
To finance the properties, Merchants Capital secured $56 million of construction loans provided by Merchants Bank of Indiana and $59 million in permanent financing through Freddie Mac Non-Low-Income Housing Tax Credit (LIHTC) Forward Commitments and Freddie Mac Permanent Loans.